The economic managers of the country so far have inked free trade agreements (FTAs) with all countries without incorporating one of the most sought-out traditional products of Pakistan- the handmade carpets, as the bureaucracy never bothered to take the real stakeholders on board.

According to industry sources, all FTAs with other countries have included the machine made carpets which are produced in limited number and have almost zero demand abroad. On the other hand, handmade carpets of Pakistan have a huge demand all over the world and Pakistan has great potential and special skill to produce this product but face high competition in global market due high duties.

They said that handmade carpet exports registered another decline of more than 10% during first half of the current fiscal year of 2014-15 despite free market access to the EU countries under GSP Plus status. The country has already suffered a huge decline of over 50% during the last seven years, as hand-made carpets export had fallen to $120 million from $300 million, depriving almost 0.5 million people of their direct employment.  The government needs to incorporate hand knotted carpets in FTAs with China, Malaysia, Indonesia, Vietnam, Russia, Brazil etc as the handmade carpets have not been included in any of Pakistan’s free trade agreements with other countries.  The acute shortage of electricity, bad law and order, ever-soaring inflation, shortage of skilled labour force and high mark-up rate are the reasons of sharp decline in carpet exports, industry experts said.

The GSP Plus facility has restricted some drop in carpets export, otherwise this decline might have been more than 20% with this free trade access facility, they added. Pakistan has to make an extra effort in promoting exports by arranging trade fairs and exhibitions, they emphasized and added that stability of our economy will help us overcome many challenges facing our country particularly war against terrorism. Pakistan Carpet Manufacturers and Exporters Association (PCMEA) Chairman Usman Ghani stated that carpet industry has to take full advantage of the entry got in Chinese handmade carpet sector. “Instead of looking towards United States and European Union the Pakistani exporters should now focus on China to take trade relations to a new height by aggressively exploring opportunities for joint ventures in various sectors including hand-knotted carpets,” he added.

He observed that that Pakistan’s carpet export to Europe and China had declined by over 55 per cent which can be compensated by export to China and Turkey, where this handmade product is in great demand.

Punjab CM Shahbaz Sharif, Commerce Minister Khurram Dastgir and TDAP Chief Executive S M Muneer have realized the importance of this point, Usman Ghani said. He asked the government for remaining all along with the carpet industry and pursuing the Chinese authorities to exempt the Pakistani handmade carpets from import duty, bringing it under zero-rated in China.

Demanding special initiatives, PCMEA SVC Qamar Zia asked the government to finance the carpet industry to open warehouses and retail outlets abroad including China. He said, presently, China is the largest carpet buyer of Pakistan. We are struggling for the enhancement of Pakistani carpet export to China, he maintained.

Qamar Zia stated that China, Dubai and Germany are the classic examples of well organized international trade fairs/centers, where businessmen from all over the world used to attend. In order to strengthen the efforts to promote Pakistan’s cultural heritage, the government must allocate substantial amount from its annual development budget (PSDP) for promotion of carpet industry, he opined.